Managing a budget can be a nervy process for some, and as a result a blind-eye can be turned which can lead to financial problems further down the line.
Drawing up your budget and setting allowances is the easy part, the difficult bit is keeping to the spending plan each month, and this is essentially the key to successfully managing your finances
We compiled a few tips for you in this guide, which should clarify good practise for budget management...
Divide your finances
Utilising multiple bank accounts can help you to divide your money into 'pots' so as to not overspend on non-necessities. Lot's of people struggle to keep a tab of money coming and going from their main account, and if this applies to you, no doubt it will be useful to separate your finances for bills etc and your disposable spending money for that month. If you only have one account, your bank will happily provide an additional account, or you could even look to change provider, with some banks offering cash incentives to switch to their service. The main downside with this is the amount of extra paperwork generated from managing more than one account, which brings us to our second point
Check bank statements
Regardless of your financial situation, it's always good practise to keep an eye on the bank statements you receive each month. Obviously if you're budgeting, this will allow you to scrutinise your own spending to make sure that transactions have been processed properly, and give you opportunity to check that there is no suspicious activity or fraud taking place on your account.
Keep a spending diary
This will work hand-in-hand with your bank statements and will aid you in checking that your statements are correct each month. It may seem like a pointless task to write everything down, but if you tend to pay by card for purchases, or if you choose not to separate your slending money this will allow you keep track of things, without having to constantly refer to your bank account, which can sometimes take a day or two to update debits taken from your account, leaving you to think you have more money available than you actually do. Also you're likely to find that keeping a diary will help you focus on your spending budget, as many people are reluctant to spend frivolously, knowing that they will have to detail it in writing! Depending on how involved you want to get with this, there are a number of personal finance software's available on the market which will make it easier to calculate everything, although a simple spreadsheet will normally suffice; saving you additional expenditure.
Regularly reassess your budget
From time-to-time personal circumstances change, and as such you will need to reassess your budget if and when it happens. Periodically reviewing things every 12 months or so is a good idea anyway as it gives you the opportunity to make more savings, improving your finances more. For example, loyal gas an electricity customers aren't rewarded for their custom, so there's nothing to stop you checking for a cheaper supplier; potentially saving hundreds of pound each year on fuel. The same is also true for insurance policies (home, car, travel et al.), mobile phone contracts, broadband and cable contracts, and other form or service you pay for where there is a competitor to your current supplier.
Having more money is as good a time to rebudget, as having not enough money. If you're able to free up some money (or perhaps your finances improve from a promotion or change of employer), the temptation can be there to loosen the purse strings and spend more. Re-budgeting as soon as possible will mean that you're less likely to spend indiscriminately, and thus be able to make the most of your additional money